India plans to launch its first tokenized corporate bond pilot in September 2026, with state-controlled power financier REC Limited issuing notes worth less than 5 billion rupees ($57 million). The transactions will be settled using India's wholesale central bank digital currency (CBDC). To participate, investors must hold both a bank-provided wholesale CBDC wallet and a new DEMAT 2.0 electronic securities wallet, which records bond holdings on a distributed ledger.
REC tokenized bond pilot launch
- ▪The tokenized corporate bonds issued by REC Limited will have an initial three-month lockup period, with exchanges expected to develop a secondary market by December 2026.
- ▪REC Limited, a state-controlled Indian power infrastructure finance company, plans to issue less than 5 billion Indian rupees ($57 million) in tokenized corporate bonds in September 2026.
- ▪Securities and Exchange Board of India Chairman Tuhin Kanta Pandey first announced the corporate bond tokenization pilot on May 26, 2026, targeting a six-to-nine-month rollout window.
- ▪The tokenized corporate bond pilot by REC Limited is expected to be unveiled at an annual financial technology event in Mumbai in September 2026.
Wholesale CBDC settlement infrastructure
- ▪Transactions for the September 2026 tokenized corporate bonds issued by REC Limited will be settled using India's wholesale central bank digital currency.
- ▪The Reserve Bank of India developed the Unified Markets Interface, a multi-layer platform to facilitate financial asset tokenization using wholesale central bank digital currency, as disclosed in May 2026.
- ▪The Reserve Bank of India has previously run wholesale central bank digital currency settlement pilots for government securities, interbank call money, and tokenized certificates of deposit.
DEMAT 2.0 wallet system
- ▪Indian securities depositories are developing a new electronic securities wallet called DEMAT 2.0 to record tokenized corporate bond holdings using distributed ledger technology.
- ▪The Reserve Bank of India and the Securities and Exchange Board of India are collaborating on the development of the DEMAT 2.0 electronic securities wallet.
Dual-wallet investor requirements
- ▪Subsequent trades of the tokenized corporate bonds can only occur between market participants who hold both compatible central bank digital currency and DEMAT 2.0 securities wallets.
- ▪Investors participating in the September 2026 tokenized bond pilot will be required to hold both a bank-provided wholesale central bank digital currency wallet and a DEMAT 2.0 electronic securities wallet.
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